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###### Federal Trade Commission

# AGENCY:

Federal Trade Commission (FTC or Commission).

# ACTION:

Notice and request for comment.

# SUMMARY:

                        The information collection requirements described below will be submitted to the Office of Management and Budget (OMB) for review, as required by the Paperwork Reduction Act (PRA). The FTC is seeking public comments on its proposal to extend through January 31, 2014, the current PRA clearance for information collection requirements contained in its Rule Governing Pre-Sale Availability of                               ( print page 2907)                            Written Warranty Terms. This clearance is scheduled to expire on January 31, 2011.                    

# DATES:

Comments must be received on or before March 21, 2011.

# ADDRESSES:

                        Interested parties are invited to submit written comments electronically or in paper form, by following the instructions in the Request for Comments to 30-Day Notice part of the                         **SUPPLEMENTARY INFORMATION**                         section below. Comments in electronic form should be submitted by using the following Web link:                         *https://ftcpublic.commentworks.com/​ftc/​presaleavailabilitypra2*                         (and following the instructions on the Web-based form). Comments in paper form should be mailed or delivered to the following address: Federal Trade Commission, Office of the Secretary, Room H113 (Annex J), 600 Pennsylvania Avenue, NW., Washington, DC 20580, in the manner detailed in the                         **SUPPLEMENTARY INFORMATION**                         section below.                    

# FOR FURTHER INFORMATION CONTACT:

Requests for copies of the collection of information and supporting documentation should be addressed to Allyson Himelfarb, Investigator, Division of Marketing Practices, Bureau of Consumer Protection, Federal Trade Commission, Room H-286, 600 Pennsylvania Ave., NW., Washington, DC 20580, (202) 326-2505.

# SUPPLEMENTARY INFORMATION:

## Proposed Information Collection Activities

Under the PRA, 44 U.S.C. 3501-3521, Federal agencies must obtain approval from OMB for each collection of information they conduct or sponsor. ``Collection of information'' means agency requests or requirements that members of the public submit reports, keep records, or provide information to a third party. 44 U.S.C. 3502(3), 5 CFR 1320.3(c).

On September 16, 2010, the Commission sought comment on the information collection requirements associated with the Rule Governing Pre-Sale Availability of Written Warranty Terms, (the Pre-Sale Availability Rule), 16 CFR 702. No comments were received. Pursuant to the OMB regulations, 5 CFR Part 1320, that implement the PRA, the FTC is providing this second opportunity for public comment while seeking OMB approval to renew the pre-existing clearance for the Rule (OMB Control No. 3084-0112). All comments should be filed as prescribed below, and must be received on or before February 17, 2011.

                    The Pre-Sale Availability Rule is one of three rules [1]                                          that the FTC implemented pursuant to requirements of the Magnuson-Moss Warranty Act, 15 U.S.C. 2301*et seq.*                     (Warranty Act or Act).[2]                                          The Pre-Sale Availability Rule requires sellers and warrantors to make the text of any written warranty on a consumer product costing more than $15 available to the consumer before sale. Among other things, the Rule requires sellers to make the text of the warranty readily available either by (1) displaying it in close proximity to the product or (2) furnishing it on request and posting signs in prominent locations advising consumers that the warranty is available. The Rule requires warrantors to provide materials to enable sellers to comply with the Rule's requirements and also sets out the methods by which warranty information can be made available before the sale if the product is sold through catalogs, mail order, or door-to-door sales.                

## Request for Comments

                    Interested parties are invited to submit written comments electronically or in paper form. Comments should refer to ``Pre-Sale Availability Rule: Paperwork Comment, FTC File No. P044403'' to facilitate the organization of comments. Please note that your comment—including your name and your State—will be placed on the public record of this proceeding, including on the publicly accessible FTC Web site, at (                    *http://www.ftc.gov/​os/​publiccomments.shtm*).                

                    Please also note that because your comments will be made public, you are solely responsible for ensuring that it does not include any sensitive personal information, such as any individual's Social Security number, date of birth, driver's license number or other State identification number or foreign country equivalent, passport number, financial account number, or credit or debit card number. It is also your own responsibility to ensure that your comment does not include any sensitive health information, such as medical records or other individually identifiable health information. In addition, your comment should not include any ``[t]rade secret or any commercial or financial information which is obtained from any person and which is privileged or confidential * * *,” as provided in Section 6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2). No comment, whether it contains such material or not, will be given confidential treatment unless the comment has been filed with the FTC Secretary; the comment is accompanied by a written confidentiality request that complies fully with FTC Rule 4.9(c), 16 CFR 4.9(c);[3]                                          and the General Counsel, in his or her sole discretion, has determined to grant the request in accordance with applicable law and the public interest.                

                    Because postal mail addressed to the FTC is subject to delay due to heightened security screening, please submit your comments in electronic form or send them by courier or overnight service. To ensure that the Commission considers an electronic comment, you must file it at                     *https://ftcpublic.commentworks.com/​ftc/​presaleavailabilitypra2,*                     by following the instructions on the Web-based form. If this Notice appears at                     *http://www.regulations.gov,*                     you may also file an electronic comment through that Web site. The Commission will consider all comments that regulations.gov forwards to it. You may also visit the FTC Web site at                     *http://www.ftc.gov*                     to read the Notice and the news release describing it.                

A comment filed in paper form should include the ``Pre-Sale Availability Rule: Paperwork Comment, FTC File No. P044403'' reference both in the text and on the envelope, and should be mailed or delivered to the following address: Federal Trade Commission, Office of the Secretary, Room H-113 (Annex J), 600 Pennsylvania Avenue, NW., Washington, DC 20580. The FTC is requesting that any comment filed in paper form be sent by courier or overnight service, if possible, because U.S. postal mail in the Washington area and at the Commission is subject to delay due to heightened security precautions.

                    Comments on any proposed recordkeeping, or disclosure requirements that are subject to Paperwork Reduction Act review by the OMB should additionally be submitted via facsimile to OMB at (202) 395-5167 and addressed as follows: Office of Information and Regulatory Affairs, Office of Management and Budget, Attention: Desk Officer for Federal Trade Commission. Facsimile                           ( print page 2908)                        submission is preferred over U.S. postal mail delivery by the OMB, as the latter type of delivery is subject to delays due to heightened security precautions. Still, in case it is needed, the OMB mail address is: Office of Information and Regulatory Affairs, Office of Management and Budget, New Executive Office Building, Docket Library, Room 10102, 725 17th Street, NW., Washington, DC 20503. The OMB requests that any comment filed in paper form be sent by courier or overnight service, if possible.                

                    The FTC Act and other laws the Commission administers permit the collection of public comments to consider and use in this proceeding as appropriate. The Commission will consider all timely and responsive public comments that it receives on or before the deadline specified above in the                     **DATES**                     section, whether filed in paper or electronic form. More information, including routine uses permitted by the Privacy Act, may be found in the FTC's privacy policy, at                     *http://www.ftc.gov/​ftc/​privacy.htm.*

*Pre-Sale Availability Rule Burden Statement:*                     Total annual hours burden: 2,490,000 rounded to the nearest thousand.                

In its 2007 submission to OMB, FTC staff estimated that the information collection burden of making the disclosures required by the Pre-Sale Availability Rule was approximately 2,328,000 hours per year. Although there has been no change in the Rule's information collection requirements since 2007, staff has adjusted its previous estimate of the number of manufacturers subject to the Rule based on recent Census data. From that, staff now estimates that there are approximately 478 large manufacturers and 15,444 small manufacturers subject to the Rule. In addition, recent Census data suggests that there are an estimated 6,892 large retailers and 452,553 small retailers impacted by the Rule.

                    In its 2007 submission to OMB, staff took note that some online retailers had begun to make warranty information directly available on their Web sites, thereby reducing their paperwork burden under the Rule. As e-commerce continues to grow, it is likely that even more retailers are posting warranty information online than they were in 2007. Nevertheless, because the staff assumes that only a small percentage of retailers would be significantly less burdened by posting warranty information online—namely, retailers with a large Internet presence or whose inventory is mainly composed of warranted products [4]                                         —the staff has retained its previous estimates of the hour burden for retailers. Therefore, staff continues to estimate that large retailers spend an average of 20.8 hours per year and small retailers spend an average 4.8 hours per year to comply with the Rule.[5]                                          Accordingly, the total annual burden for retailers is approximately 2,315,608 hours ((6,892 large retailers × 20.8 burden hours) + (452,553 small retailers × 4.8 burden hours)).                

                    Staff also estimates that more manufacturers are beginning to provide retailers with warranty information in electronic form in fulfilling their obligations under the Rule. Therefore, staff finds it necessary at this time to adjust the hour burden for manufacturers as it did with retailers in its previous submission to OMB. Applying a 20% reduction to its previous estimates, the staff now assumes that large manufacturers spend an average of 42 hours per year and that small manufacturers spend an average of 10 hours per year to comply with the Rule.[6]                                          Accordingly, the total annual burden incurred by manufacturers is approximately 174,516 hours ((478 large manufacturers × 42 hours) + (15,444 small manufacturers × 10 hours)).                

Thus, the total annual burden for all covered entities is approximately 2,490,124 hours (2,315,608 hours for retailers + 174,516 hours for manufacturers).

*Total annual labor cost:*                     $47,000,000 rounded to the nearest thousand.                

                    The work required to comply with the Pre-Sale Availability Rule entails a mix of clerical work and work performed by sales associates. Staff estimates that half of the total burden hours would likely be performed by sales associates. At the manufacturing level, this work would entail ensuring that the written warranty accompanies every consumer product or that the required warranty information otherwise gets to the retailer. At the retail level, this work would entail ensuring that the written warranty is made available to the consumer prior to sale. The remaining half of the work required to comply with the Pre-Sale Availability Rule is clerical in nature, e.g., shipping or otherwise providing copies of manufacturer warranties to retailers and retailer maintenance of them. Applying a sales associate wage rate of $22/hour to half of the burden hours and a clerical wage rate of $16/hour to half of the burden hours, the total annual labor cost burden is approximately $47,312,356 (1,245,062 hours × $22 per hour) + (1,245,062 hours × $16 per hour).[7] 

*Total annual capital or other non-labor costs: De minimis.*

The vast majority of retailers and warrantors already have developed systems to provide the information the Rule requires. Compliance by retailers typically entails keeping warranties on file, in binders or otherwise, and posting an inexpensive sign indicating warranty availability. Manufacturer compliance entails providing retailers with a copy of the warranties included with their products.

Willard K. Tom,

General Counsel.

# Footnotes

1.                             The other two rules relate to the information that must appear in a written warranty on a consumer product costing more than $15 if a warranty is offered and minimum standards for informal dispute settlement mechanisms that are incorporated into a written warranty.                    
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2.                             40 FR 60168 (Dec. 31, 1975).                    
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3.                             In particular, the written request for confidential treatment that accompanies the comment must include the factual and legal basis for the request, and must identify the specific portions of the comment to be withheld from the public record.                         *See*                         FTC Rule 4.9(c), 16 CFR 4.9(c).                    
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4.                             In addition, many online retailers also operate ``brick-and-mortar'' operations and still provide paper copies of warranties for review by customers who do not do business online.                    
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5.                             FTC staff recently contacted representatives from two retailer associations—the National Retail Federation and the North American Retail Dealers Association—but we have not received any additional information that indicated we need to update the hours estimates.                    
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6.                             FTC staff recently contacted representatives from the Association of International Automobile Manufacturers, but we have not received any additional information that indicated we need to further adjust the current hour estimates.                    
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7.                             The wage rate used in this Notice reflect recent data from the Bureau of Labor Statistics National Compensation Survey (                        *http://www.bls.gov/​ncs/​ocs/​sp/​nctb1346.pdf*).                    
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[FR Doc. 2011-929 Filed 1-14-11; 8:45 am]

BILLING CODE 6750-01-P